MGC Pharmaceuticals (ASX:MXC) is a small-cap pot-stock that’s rapidly
emerging as a leading voice in the buzzing medicinal cannabis space. Harnessing
years of experience in the globally renowned Israeli marijuana sector, MXC is
creating a highly supervised supply chain from planting to extraction. It
already has wide-reaching global footprint, with facilities across Australia,
Slovenia and the Czech Republic, and plans to expand into the Asian, UK and US
markets. Finfeed.com’s Zoe Gross recently caught up with CEO, co-founder and managing director, Roby Zomer, to get
an inside look at what differentiates MXC from its peers.

FF: Thanks for speaking with us today, Roby. First
off, for readers who are only just tuning in to the MXC story now, could you
give me a brief overview of the company and its key operations?

Roby: MGC Pharma is a global biopharma company with operations
in Europe, Australasia and soon North America, focusing on the benefits of
phytocannabinoids — namely, the
extracts of the cannabis plant. We control the entirety of our supply chain,
from seed to prescription and are focused on demonstrating the various benefits
to be elicited from the cannabis plant. Having a supply chain that encompasses
the entire process means that we can compete at every level of the current
global cannabis market, from cultivation and production to supply of
medication.

We have three sectors. Firstly, MGC Pharmaceuticals,
which focuses on the research and development of medicines to treat conditions
such as cancer and epilepsy. There’s also MGC Botanic, our European operations
where we grow, cultivate, produce and process the cannabis that’s infused into
the other divisions. Thirdly, we also have MGC Derma, a range of skincare
products aimed at treating skin conditions such as psoriasis and acne.

We are building our business around perfecting and
creating this pipeline for global scalability, as well as finding specific
commercial ventures which we deem valuable as revenue drivers and business
builders in the long term. These include our entries into the cosmetics market
(MGC Derma), the nutraceutical and supplement market (MGC Nutraceuticals), and,
of course, the pharmaceutical market.

It should be noted that this remains a speculative
stock and investors should seek professional financial advice if considering
this stock for their portfolio.

FF: Medicinal marijuana is a rapidly growing
space that thrives in tandem with a spectrum of legislative changes around the
world — for example, the
recent changes to export laws in Australia. The global cannabis market itself
is now worth $55 billion. Tell me a bit about how you ended up in this sector.
Why is this an important field, and where do you think it’s heading in the
coming years?

Roby: The importance of
medicinal cannabis and medicinal cannabis research is becoming increasingly
clear due to the success of products currently available. This is forcing a
seismic shift in mindsets which will drive growth in the sector in the coming
years.

My background is within biofuel and the
renewable energy sectors. There are many similarities across these industries
and cannabis, like overcoming skepticism and competing with big businesses
already established in the industry. This appealed to me, as well as the
obvious curative powers of an asset, with the potential to have a global health
impact. Both industries are pioneers and have a focus on significantly
affecting quality of life for individuals all over the planet.

As for the dollar value of the market – I
think we are at the tipping point where medicinal cannabis, as a pharmaceutical
product, is beginning to get the acknowledgment it deserves, alongside its
already established position as a lifestyle product, so the potential growth in
current and new markets is exciting.

However, all that being said, at MGC, our core
business is pharmaceuticals, and for that reason we think it’s very important
the medicinal cannabis industry be built responsibly, considering the duty of
care we have over our current and future patients.

FF: How is MXC positioned in relation
to this blossoming industry?

Roby: Our recent
announcement regarding operations in Malta, as well as our constant progress in
Slovenia, ensure that MGC is uniquely well-positioned for the rapidly growing
EU market. This, in combination with our global vision of holding a multi-pronged
cultivation pipeline in Europe, Australasia and North America, secures our
place as a significant presence in multiple geographies with rapidly expanding
markets for various applications of our product line.

Driven by a strong product pipeline and GMP
facilities in Europe, we have the ability to dynamically engage in new markets
as they emerge. Our knowledge and certification puts us in a great position to
provide products and services to various verticals, and partnerships with
like-minded local distributors and research facilities means we are keeping
ahead of the market and its needs.

All this goes to say that whichever way this
unexpected market starts going, in terms of product demands, quality control
and transparency, and other global shifts, we are ready and able to adjust
ourselves accordingly.

FF: You’ve recently hit a major landmark with
a letter of intent (LOI) from the Maltese government to construct a
fully licensed medical cannabis facility. Tell me a bit more about that
and what this means for MXC.

Roby: Firstly,
receiving the LOI from Malta Enterprise, the industry building arm of the government,
was a great landmark in achievingour vision of seed-to-pharma
operations, as well as improved positioning for the European emerging market. Alongside
the proposed advantages from the government itself, several positive elements
such as suitable climate conditions allow us to have much more cost-effective
raw materials, which will assist in achieving our target of affordable
medication.

This, in combination with the advantages of
building a central medicinal cannabis operation facility in Malta, a global
central trading hub, positions us well for global industry growth. Recent
changes in law (in various countries) indicate increased willingness and
openness from governments to be a part of a potentially very lucrative
industry.

MGC have been given an exciting opportunity in
Malta as we are the only Australian company of five chosen to be awarded land
in which to build a facility. We continue to work closely with the Maltese
government to support local research, development and education.

Finally, as global markets open up, Malta will
be a key factor in unifying our global supply chain. We imagine a reality where
extracts produced in Malta, Australia or North America could be formulated and
compounded based on our R&D facility in Slovenia, and then sent off to
patients globally. This would truly be an expression of the seamless supply
chain we are putting together.

It is early stages in building this supply
chain, so investors should take all publicly available information into account
before making an investment decision in this company.

FF: On top of that, CannEpilTM production
has now officially kicked off. Tell me more about that.

Roby: This is a very
exciting landmark for MGC, and for the industry at large. We have manufactured
the first batch of CannEpil, which is now in the hands of Slovenian authorities,
undergoing strict testing and validation, following which we will receive our
permanent GMP compounding certification. Receipt of this certification will
allow us to start our clinical research on CannEpil and to provide it to our
prescribers and patient group in Australia. We see this as monumental as it
represents the initiation of a product pipeline which will grow over time with
new products. The first time is the hardest, and we are happy to see the light
at the end of the tunnel, especially when that means CannEpil is one step
closer to helping patients.

FF: MGC Pharmaceuticals has already got a
diversified selection of cannabis-related offerings — for example, your newly launched nutraceuticals
line, a dermatology business, the CannEpil epilepsy drug. What other
applications are you keen to explore next?

Roby: As a biopharma company, our focus is primarily
on developing medicines and pharmaceuticals products as treatments for
conditions such as cancer, chemotherapy side-effects, inflammation and other
neurological disorders. The pipeline of products and research and development
agenda has been explained in our most recent investor presentation.

In addition to this, MGC has already actively
explored and utilised the beneficial properties of medicinal cannabis within
our dermatological and nutraceutical products, and we are always looking for
new opportunities that emerge within these sub-sectors.

Our research currently incorporates research
into delivery systems, through proprietary formulations involving more than
just phytocannabinoids, and even extends through to finding novel usages for
by-products and exciting crossovers with other therapies.

FF: How does MXC stand out when compared
to other medicinal cannabis companies?

Roby: I think that the most significant
differentiator between us is that we are biopharma company with a global
footprint built by a select group of advisors, that are experts in their
respective fields, all bringing a wide-range of experience. This gives us the
unique ability to explore various levels of product development and
implementation, giving us multiple markets to develop and serve.

The second is our control of our entire supply
chain, enabling us to deliver the highest quality products to the market, from
our genetics R&D through to our analytical labs and GMP facility. The third
would be our commitment to achieving the highest level of certification for our
supply chain and our products. This is a laborious, time-consuming and an often
frustrating endeavor, but we believe it pays off in our positioning as a market
leader, as a consistent and dependable provider, and as a company that knows
how to play by the rules in several geographies.

Furthermore, I would point out our consistent
investment in R&D, the type that will benefit not only us, but the industry
as a whole. Engaging with the academic world to ensure it is part of the future
learning and training of doctors, pharmacists and scientists is crucial to
ensuring that this shift is not just a blip, but a true change. Our engagement
with leading universities in Australia, our joint project with RMIT, our
clinical trials in Europe, these are all part of ensuring we are at the front
lines of this emerging industry as it grows.

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